Background: Cognitive impairments, for which there are no effective treatments, contribute significantly to functional disability in schizophrenia. Th goal of this application is to use a translational neuroscience approach to develop a treatment for the cognitive impairments associated with schizophrenia (CIAS). Deficits in NMDA receptor (NMDAR) function contribute to the CIAS and therefore, facilitation of NMDA-R function is one potential treatment approach for CIAS. Glycine transporter inhibitors (GlyT1Is) can enhance NMDAR related plasticity by raising synaptic glycine levels and stimulating the GlycineB co-agonist site of NMDARs. Preclinical data support the potential of GlyT1Is as treatments for the CIAS. PF-03463275 is a Glyt1I inhibitor that has not been tested for treatment of the CIAS. Higher doses of Glyt1Is including PF-03463275 may have a plateauing and/or worsening of effects suggestive of an inverted 'U' dose response. Therefore, it is critical for the optimal therapeutic dose range of GlyT1Is. UH2: The goal of the UH2 is to determine the best dose of PF-03463275. We will use positron emission tomography (PET) imaging to determine the dose-related occupancy of F-03463275 in order to determine whether it reaches its intended target and produces sufficient occupancy to be effective. In parallel, we will use fMRI as an assay of the dose-related GlyT1I facilitation of NMDAR function; we will determine whether PF-03463275 produces dose-related attenuation of the ketamine-induced disruption in prefrontal cortical BOLD activation related to working memory. UH2 Approach: 24 healthy subjects will receive placebo or two active doses of PF-03463275 BID for one week each during each of which, they will undergo a PET scan, long-term potentiation (LTP) session and a Ketamine-fMRI challenge study. UH3: In this phase (UH3), we will test the efficacy of PF-03463275 for CIAS in a novel proof of concept, double-blind, placebo-controlled, between-group study. Pharmacological enhancement of plasticity may not be sufficient to remediate long-standing cognitive dysfunction in the presence of the typical impoverished cognitive environment that patients live in. Therefore, just as physical exercise might optimize the effects of anabolic steroids, this trial wil combine cognitive remediation with PF-03463275 treatment. UH3 Approach: Schizophrenia subjects (n=76) taking risperidone or aripiprazole will be randomized to receive either placebo or active PF-03463275 BID in addition to cognitive remediation. Change in CAIS will be assessed using the Matrics Consensus Cognitive Battery composite score. We will also use visual Long Term Potentiation (LTP), an in vivo measure of NMDA-R-dependent synaptic plasticity, as a novel biomarker of the mechanism of action of PF-03463275. Using this approach, we propose to identify PF-03463275 effects on plasticity as indexed by LTP and to evaluate the capacity of PF- 03463275 to restore this form of neuroplasticity in schizophrenia patients, in whom it is deficient.